Last year DC raised the price of twenty titles. At the time, Marvel responded that it would not be raising prices for the foreseeable future. The foreseeable future turns out not to have been very long at all, as last week Marvel announced its own price rises on 13 titles. One hopes that Marvel received an improved crystal ball for Christmas, as its previous one was evidently cracked.

By my count, Marvel only publishes thirty ongoing titles, so those thirteen make up a fairly large proportion of the line. Moreover, they're big price rises - from $2.25 to $2.99. Okay, on the one hand, that's only 74 cents. On the other, it's roughly 33%. True, Marvel already has a range of monthly titles at $2.99, but a price rise of that order is unlikely to have been decided on lightly.

Marvel's official explanation for the price rise is, and I quote:-

"This is simply a situation where we either raise the cover price of some of these series or be faced with cancelling them. This option allows us to continue publishing titles that enjoy loyal fanbases and puts the choice in the hands of the readers as to whether or not to continue following them."

Well, now.

True enough, this announcement has sparked the usual round of wailing that accompanies every price rise, usually from people with a shaky grasp of basic economics. I appreciate that many of you will have read the following explanation numerous times before, but let's trot through it one more time. Yes, it's a basic rule of market economics that if you raise prices, demand will fall. And if you lower them, demand will rise.

'Marvel is betting that demand is inelastic and it will make more money.' But that doesn't answer the question of how much they will rise or fall. This is the concept of "elasticity of demand" - the extent to which demand for a product is affected by price changes. If demand is greatly affected by price changes, then demand is elastic. If it is only slightly affected, demand is inelastic. If demand is sufficiently inelastic, then raising prices make you more money. You will lose sales, but you'll be making more money on the sales you have left, and this more than cancels out the ones you lose. The more inelastic the demand, the more you can get away with raising the prices.

A classic illustration of elasticity of demand at work is the UK government policy of trying to put people off smoking and drinking by raising taxes on cigarettes and alcohol sky high. Did this work? No, of course it didn't. Demand for these products is almost totally inelastic, because smokers are addicted, and everyone else really, really loves getting hammered. Thus, the plan totally failed in its aim of reducing smoking and drinking, but on the bright side, it raised a ton of money for the Treasury.

So in raising prices, Marvel is betting that demand is inelastic and therefore it will make more money. Simple.

Now, is Marvel right? Well, let's do some basic maths. Suppose GENERIC MAN is selling 10,000 copies at $2.25 an issue. That's bringing in $22,500. Yes, yes - some of that's going to retailers, some of it's going to distributors, I know. Forget about that for the moment; let's keep the example simple. $22,500.

If you raise the cover price to $2.99, you only have to sell 7,526 copies to bring in the same amount of money. Anything more than that, and you've increased your profits. So sales will fall - it doesn't matter. The question is, will they fall by less than 25%? If the answer is yes, Marvel makes more money.

I have to say, it sounds like a fairly safe bet to me. Is a quarter of the readers of these books going to say to hell with it, just because the title now costs the same as DAREDEVIL? It doesn't seem very likely. Comics readers are a fairly inelastic market, I think. Sure, they've been drifting away for ages, but that's nothing to do with price. In the short term, it ought to mean more money.

'Marvel is raising some prices for reasons totally unconnected with cancellation.' Besides, what's the downside for Marvel? If it loses the bet and profits fall, then so what - it was going to cancel the title anyway. Marvel only stands to win. And the list of titles whose prices are rising does indeed include some of Marvel's perennial low-sellers. SPIDER-GIRL, BLACK PANTHER, SOLDIER X, ULTIMATE ADVENTURES and MARVILLE are titles which don't sell at all well by Marvel's standards, and show no real prospect of turning around. Quite why anyone would want to save MARVILLE for future generations is a debatable question, but it's not like raising its price is going to shorten its lifespan appreciably.

But wait a minute. Look at the rest of the list. THOR? IRON MAN? EXILES? Not Marvel's top sellers, to be sure, but solid mid-table performers.

BLACK PANTHER and SPIDER-GIRL have both, notoriously, been hovering near Marvel's cancellation point for ages. By ICV2's figures, BLACK PANTHER tends to sell in the 18-19,000 range. SPIDER-GIRL, somewhere in 23-24,000. IRON MAN is usually up around 33,000, and THOR around 36,000. (Both those titles received an artificial boost this month because of a crossover with the higher-selling AVENGERS, but these are their usual ranges.)

It is rather hard to credit that THOR, which sells almost twice as much as the borderline BLACK PANTHER, can be in danger of cancellation due to low sales. In fact, it's simply unbelievable. It would mean that Marvel had drastically raised their cancellation threshold, to more than double what PANTHER presently sells. Rather unlikely, considering that PANTHER is thought to have some chance of surviving with a 33% price rise.

Look again at Marvel's official explanation: "This is simply a situation where we either raise the cover price of some of these series or be faced with cancelling them." Some of these series. Not all. The rational explanation is that Marvel is raising prices on at least some of these books for reasons totally unconnected with their cancellation threshold, and has elected not to share with us what those reasons might be. As, of course, is its right.

If demand is inelastic on these titles, then of course a price rise will generate more income for Marvel and make more profit. That alone might be thought to be an excellent reason for doing it. Except with the midtable books, there is a genuine risk - if the calculation has misfired, it might end up killing a comic that would otherwise have done okay.

'Maybe the people who are still buying monthly comics are a closed and inelastic market.' Still, perhaps Marvel has identified some of these titles as expendable subjects for an experiment into what the market will bear. After all, none of them are exactly setting the balance sheet alight - and if Marvel does inadvertently tank a healthy comic, it can just relaunch it with a new creative team three months later. The loss of titles like Mike Grell's IRON MAN may well be a perfectly acceptable risk for Marvel, especially if it has faith in its assessment of the market. And if this works for the mid-table comics, who knows, maybe it'll work for the top sellers as well.

The top end of the charts is still packed with $2.25 books (most of them Marvel's). But there are higher priced books that have done just fine up there - nobody seemed to be put off DreamWave's TRANSFORMERS: ARMADA or Image's GI JOE by their $2.95 price tags. Some of the Marvel Knights books are already selling quite acceptably at $2.99, as is X-TREME X-MEN. Simply put, if this is what the market will bear, why not charge it?

After all, comics passed the point of being an impulse buy years ago. Marvel tried the cheap comics route a while back, with the 99c line. True, most of them were diabolical, but UNTOLD TALES OF SPIDER-MAN wasn't, and it still sank like a stone. Newsstand distributors wouldn't even carry the damn things, because they didn't have enough profit margin to make them worthwhile. The cheap monthly pamphlet is a dead format, and it's never coming back. It's now a luxury item, priced accordingly. This is just the way things are.

Having sacrificed the impulse buyers, maybe it's time to accept the reality that the people who are still buying monthly comics are a closed and inelastic market who aren't going anywhere. Sure, raising prices may put off new readers - but are they seriously going to be attracted to the monthly format anyway? SHONEN JUMP's surprising initial success, if it's borne out in future months, suggests that the way to new readers is the cheap, newsstand digest format.

If the future of 21st century comics is graphic novels and low-priced bulk digests - and that's an eminently plausible view of the future - then the direct market and its monthly pamphlets are nearing the end of their lifespan. In which case, why not bleed them dry while they still have blood to give? It's not like we'll be needing them.

Paul O'Brien is the author of the weekly X-AXIS comics review.

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